May 2: The dollar was headed for its biggest weekly loss against the yen since February on Friday after Japan was reported to have intervened to support its currency.
Markets remained on edge after Japan’s top currency diplomat, Atsushi Mimura, said speculative positions were still evident, underscoring authorities’ unease over rapid yen moves.
The dollar briefly slid from around 157.1 to 155.49 against the yen JPY= before recouping some losses after Mimura’s remarks. It was last up 0.26 percent to 157.04.
“The durability of intervention remains uncertain,” said Uto Shinohara, senior investment strategist at Mesirow Currency Management in Chicago.
“Historically, its effects tend to fade without accompanying policy shifts, rate hikes or coordination.”
Two sources familiar with the matter told Reuters that officials had intervened to buy the yen on Thursday after it hit 160.7 per dollar, its weakest since July 2024.
Japan is heading into its Golden Week holiday next week, with analysts speculating that officials could step in to support the yen again.
“Given that the authorities conducted FX interventions during the Golden Week holiday in 2024, and that interventions in both 2022 and 2024 were carried out on consecutive days, the risk of additional intervention �" even during the holiday period �" remains, if USDJPY rebounds sharply towards 160,” said Barclays analysts led by Shinichiro Kadota.�"Reuters
